What I’m Reading
Defying Gravity: Apartment leasing is typically a seasonal business, with demand cooling with the weather in the winter months. That has not been the case in 2021 and thus far in 2022. Both Q4 occupancy and January occupancy increased for the first time in history, according to RealPage. Overall occupancy in professionally managed apartments hit another new record in January 2022 at 97.6% and sits above 96% in 146 of the nation’s 150 largest metro areas. Globe Street
Reverse Course: American consumption patterns appear to be shifting from goods to services. If the shift gains steam, this will help ease both supply chain issues and inflationary pressures. Wall Street Journal
Empty Shelves: 2022 is underway with housing at what economists are calling a catastrophically low inventory in Southern California. Spectrum News See Also: One third of houses currently for sale are new construction, an all-time high. Forbes
Big Wave: Global CRE investment volume hit an all-time record in 2021. If you are looking for reasons that multifamily cap rates keep pushing lower, even as rates rise, this is it:
The multifamily sector’s share of total investment grew to 45% in Q4 2021, up from 41% in Q3 2021 and above its 2015-2019 average of 28%. Although growth was primarily driven by Sun Belt markets, gateway markets such as San Francisco, Los Angeles and Chicago all had year-over-year growth of more than 110%.
Buying Spree: Amazon doubled its real estate holdings in 2021 and now owns 16.6MM square feet of fulfillment and data centers across the North America. Expect this trend to continue as Amazon pivots away from leasing space and towards developing / owning the buildings that make up its distribution network. The Real Deal
Chart of the Day
Financial conditions have tightened substantially since the fall.
Source: The Daily Shot
WTF
Fake it Till You Make It: A man was arrested for importing and selling fake Viagra from China because Florida. Tampa Free Press
You Don’t Say: A man who nearly lost his arm after sticking it into a tiger cage at a zoo was reportedly drunk and refused to speak to deputies because Florida. News Channel 8
Basis Points – A candid look at the economy, real estate, and other things sometimes related.
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